What is the Green Deal?
By RJ Mchardy Plumbing and Heating Somerset | Tuesday, March 05, 2013, 15:45
Green Deal fast facts
The Green Deal is essentially a very cheap loan scheme to
pay for energy-saving measures which will make the UK more energy-efficient.
Why is this being done? Firstly, our homes suffer from a
shocking amount of heat loss. Secondly, Britain has ambitious targets for
cutting carbon emissions, and the Green Deal is an important part of meeting
The golden rule of the Green Deal means the amount you save
on your bills will always be greater than the cost of the energy-saving
The cost - up to a current maximum of £6,500 - is absorbed
into the future energy bills of your home and paid back over time.
An estimated 26,000,000 homes could be eligible for Green
The Green Deal will help fund energy-saving upgrades for
your home without any upfront costs. Instead, the costs are added to your energy
bills and staggered over time, like a loan.
So if you want to replace your boiler with a more
energy-efficient model, or want to install draught-proofing or loft and wall
insulation you can do so without the upfront cost.
You'll still pay for them, but the cost will be repaid over
time as an additional charge on your energy bill. However, the 'golden rule' of
the Green Deal means that your repayments will have to be less than the money
you will save on your energy bills.
The Green Deal is essentially a loan from the private
companies installing these energy efficiency measures. There's a maximum amount
of £6,500 per household and, crucially, this is tied to the home rather than
the owner, so if you move house the debt is passed on to whoever lives there
The loan is then paid back through the electricity bill over
a 25-year period.
Unlike many other home improvements initiatives, the Green
Deal is not dependent on people's income and the loans are available to
From a customer point of a view there's a few key steps you
will have to take:
First, you need to decide what needs to be done to your
home. You'll have to get a property assessment, which will be done by specially
accredited advisers who will visit your property and assess its current energy
performance and what measures are suitable for you.
Next, shop around. Once you have the results of your Green
Deal assessment you can start collecting some quotes from Green Deal providers
who will give you a range of quotes for the work.
Then all you have to do is choose which provider you prefer.
The work can take place no upfront costs, and you'll only start paying it back
as an additional charge on your energy bills. However, you also have the option
of paying for some of the work upfront if you want.
It's worth bearing in mind that while your 'deal' won't
technically be a loan; the government has indicated your contract will be
entitled to the protection given under the Consumer Credit Act, so they will
have to adhere to the guidelines.
available to me now?
Lots! The costs of energy efficiency measures have tumbled
in recent years, with products like solar panels and insulation becoming far
more affordable and commonplace.
Some energy efficiency measures are already subsidised by
energy suppliers, while some customers on certain benefits may be entitled to
theirs entirely for free. Take a look at our insulation, boilers and solar
pages for more information.
Yes. Energy-efficiency upgrades like insulation can save you
up to £310 a year, while upgrading your to a more energy efficient boiler can
save you up to £300 a year.
While cost is often the main reason not to take up these
offers, the Green Deal will offer you an upfront loan to be repaid with energy
savings. And once the Green Deal energy loan is repaid, you keep any future
the Green Deal?
Yes! Your Green Deal will be fully transferable between
suppliers as it is a fixed amount, you don't need a special Green Deal energy
Your Green Deal will be tied to your property, not to you,
so if you sell your property the debt will pass on to the next occupier.
The owner must therefore disclose any details of Green Deal
payments when selling or letting their property.
If you default on Green Deal payments you will be treated
the same as customers who default on their energy bills. So, just like if you
don't pay your gas or electricity bill, you could be disconnected.
However there are some safeguards in place to avoid this
scenario. Energy suppliers will have to go through a number of steps to help
you to keep up with your payments, including prepayments meters, and no
disconnection for certain households in winter months.
If you do feel like you are struggling to pay your energy
bills, contact your supplier and see what options are available to you as soon
as you can.
October 2012. The Green Deal was part of the Energy Act,
which came into force in October 2011, meaning the proposals under Green Deal
itself started rolling out in October last year.
However, don't expect Green Deal energy mayhem straight
away. There will probably be a few providers initially with a gradually
expanding list to choose from.
The Green Deal has generated a huge amount of discussion,
with a lot of concern centering around protection for customers.
However, there are already some protection measures already
in place, including:
an assessment from an authorised Green Deal
assessor to determine what is suitable for you;
authorised installers meeting high standards;
existing legislation governing miss-selling,
unfair trading practices and consumer credit agreements, so you should be;
clear obligations on Green Deal participants to
work within a robust Code of Practice;
clear confirmation procedures before the Green
Deal charge can start to be collected;
collection of the charge through the electricity
bill, which is regulated by Ofgem;
clear processes to follow when a property
changes hands, to ensure people know about the Green Deal before they move in;
making it clear when a customer may be required
to pay the Plan off early before they enter into a Green Deal plan.
You can find out more about Green Deal energy on the Department
of Energy and Climate Change website or call R.J.Mchardy Somerset on 01823